Down Payment Assistance Programs You Probably Don't Know About

Updated April 2026

The Down Payment Myth

The number one reason people tell me they can't buy a home is the down payment. They think they need 20% down, or they've heard that even 3.5% on a California home is $25,000+ and they just don't have it.

Here's what most people don't know: there are dozens of programs across the country that will help cover your down payment. Some of them are outright grants — money you never have to pay back. Others are loans that get forgiven after a few years. And many of them are available to people who don't think they'd qualify.

I'm licensed in 24 states, and almost every one of them has at least one DPA program I can pair with the right mortgage. Let me walk you through the major ones.

Types of Down Payment Assistance

Before diving into specific programs, it helps to understand the four main types of DPA:

Major DPA Programs

CalHFA (California Housing Finance Agency)

If you're buying in California, CalHFA is one of the first programs I look at. CalHFA offers several programs including:

• MyHome Assistance Program: A deferred-payment junior loan up to 3.5% of the purchase price (or appraised value, whichever is less). No monthly payments — it's due when you sell, refinance, or pay off the first mortgage.
• CalHFA Zero Interest Program (ZIP): Covers closing costs with a zero-interest, deferred-payment loan.
• CalHFA Forgivable Equity Builder: Up to 10% of the purchase price as a forgivable loan. If you stay in the home for 5 years, 100% is forgiven.

CalHFA programs pair with CalHFA's own first mortgage products (FHA, conventional, and VA) and have income limits based on county. In many California counties, the income limits are surprisingly generous — often above $200,000 for a household.

Chenoa Fund

The Chenoa Fund is a nationwide DPA program that works with FHA loans. It covers the 3.5% FHA down payment through either a repayable second loan or a forgivable second (forgiven after 36 on-time payments). The key advantage: Chenoa doesn't have the same income or geographic restrictions as many state programs.

HomeReady (Fannie Mae) and HomePossible (Freddie Mac)

These aren't DPA programs themselves, but they're conventional loan products designed to work hand-in-hand with DPA. Both allow as little as 3% down, have reduced mortgage insurance, and accept DPA for the entire down payment.

What makes these powerful:

• 3% down with reduced PMI compared to standard conventional loans
• Boarder and rental income can be counted — if you have a roommate or an ADU, that income can help you qualify
• Flexible sources for the 3% down — it can come entirely from DPA, gift funds, or employer assistance
• Income limits apply but are area-based and can be quite generous in higher-cost markets

GSFA (Golden State Finance Authority)

GSFA offers DPA programs in California and several other states. Their Platinum program provides up to 5.5% of the loan amount as a gift — not a loan, a genuine grant that never needs to be repaid. GSFA programs work with FHA, VA, USDA, and conventional loans.

State and Local Bond Programs

Nearly every state has a housing finance authority that offers bond-funded DPA programs. These use tax-exempt bond financing to offer below-market-rate first mortgages paired with DPA. Examples include:

• Arizona: Arizona IDA (Industrial Development Authority) offers up to 5% DPA
• Colorado: CHFA provides DPA grants and second mortgages
• Florida: Florida Housing offers multiple programs with up to $10,000 in assistance
• Texas: TSAHC (Texas State Affordable Housing Corporation) offers grants up to 5% of the loan
• Washington: WSHFC provides DPA up to 4% with options for forgivable loans

Since I'm licensed in 24 states, I can access the specific programs available in your state and match you with the best combination.

Employer-Assisted Housing Programs

Many large employers — hospitals, school districts, government agencies, tech companies — offer housing assistance to employees. These can range from grants to forgivable loans to matched savings programs. If your employer offers this benefit, it can often be combined with other DPA programs for even more coverage.

Who Actually Qualifies?

The qualification requirements are more accessible than most people assume:

Income limits are area-based. In high-cost areas like Southern California, income limits can exceed $200,000 for a household. In lower-cost areas, limits are lower but still cover moderate-income earners. Many people earning solid middle-class incomes qualify.

"First-time buyer" is broadly defined. Most programs define a first-time buyer as someone who hasn't owned a home in the past 3 years. If you owned a home 4 years ago and sold it, you're a first-time buyer again. Some programs (like certain Chenoa Fund options) don't even require first-time buyer status.

Credit requirements are reasonable. Most DPA programs require a 620-660 minimum credit score. That's achievable for many buyers who might otherwise think they don't qualify.

Homebuyer education may be required. Many programs require completion of a HUD-approved homebuyer education course. These are available online, often take a few hours, and are free or very low cost. It's a small step for potentially thousands of dollars in assistance.

How to Stack Programs

Here's where it gets interesting: you can often combine multiple sources of assistance. A typical stack might look like:

1. First mortgage: FHA loan at 3.5% down, or conventional at 3% down
2. Down payment: Covered by a DPA grant or forgivable second loan
3. Closing costs: Covered by seller concessions (up to 6% on FHA) or an additional DPA program
4. Result: You buy a home with minimal cash out of pocket

I've helped buyers close with less than $1,000 out of pocket by strategically layering the right programs together. It's not magic — it's knowing which programs exist and how they can be combined.

The Fine Print Worth Knowing

• Occupancy requirements: DPA programs require you to live in the home as your primary residence. These aren't for investment properties.
• Recapture tax: Some programs have a recapture provision if you sell within the first few years at a profit. The amount is usually small, but it's worth understanding upfront.
• Rate impact: Some DPA programs come with slightly higher first mortgage rates to offset the assistance. Others don't affect your rate at all. I always show you the total cost comparison so you can make an informed decision.
• Processing time: DPA programs can add a few days to your closing timeline. Planning for a 30-35 day close instead of 21-25 days is smart.

The Bottom Line

If the down payment is the only thing standing between you and homeownership, you owe it to yourself to explore DPA programs before giving up. There's a real chance that money is available to help you — you just need someone who knows which programs fit your situation and how to access them.

Have questions about what you qualify for? Contact Randy or schedule a call. I'll review the programs available in your state and show you exactly how much assistance you can get. You can also explore your loan program options to see which mortgage pairs best with DPA.